Venison farmers end conference on an upbeat note

News
that processors are likely to be paying more for deer this
spring was welcomed by deer farmers at their annual
conference in Methven last week.

Silver Fern Farms, one
of the two biggest venison exporters, announced its spring
chilled contract prices on the third day of the conference.

National deer manager Malcolm Gourlie said farmers who
entered a contract this spring would be able to lock in a
minimum price similar to last year’s fixed contract
prices. This season, however, there was the potential to
earn up to 50 cents a kilogram above this, if market
conditions and the exchange rate allow.

Firstlight Foods,
a smaller exporter that operates in new markets, also
confirmed that its 2014 base price for year-round supply was
more than 50c a kilo higher than 2013.

Deer Farmers
Association chair Kris Orange said this was news that many
farmers wanted to hear. “These are benchmarks around which
other exporters are likely to cluster.”

He said the
consensus of farmers at the conference was that the farm
gate venison price needed to be $2 a kg more than lamb, to
make venison farming competitive. At present the margin in
favour of venison is only a matter of cents per kilo … the
lowest it has been in many years.

“While the contract
prices on offer don’t promise what we want, they are a
step in the right direction and a signal of market
confidence that farmers having been looking for.”

DINZ
chief executive Dan Coup told farmers that there was a
pretty consistent view among marketers that traditional
European markets were improving and that we have probably
seen the bottom of the price curve. The supply pipeline is
now empty and no stocks are overhanging the
market.

“No-one is predicting where the market will peak
this season. That depends on competitors and the exchange
rate, but contracts are now on the table that enable farmers
to budget,” he said.

Mr Coup said the deer industry had
been trying for many years to break free from its reliance
on the traditional game meat commodity trade in Europe. The
future, he said, lay in creating a brand for the NZ product
which would attract a premium price and year-round
demand.

“This takes time. It will also require farmers
to commit their animals to that branded marketing programme,
regardless of what happens in the commodity
trade.”

Already some exporters are making good progress
in niche markets. Conference goers heard that Mountain River
Venison has created a premium brand in Sweden, where venison
is traditionally consumed year-round. In the Netherlands,
Firstlight Foods and Silver Fern Farms are working with a
major food service company to build year-round demand for
chilled product branded as NZ farm raised venison rather
than game.

But the big hope lies in the proposed launch of
the premium Cervena brand in Europe and potentially China,
driven by the five largest venison exporters. Mr Coup said
DINZ venison marketing manager Innes Moffat was currently
overseas getting market feedback on the concept.

Alliance
Group marketing manager John Rabbitt said he was an
enthusiastic supporter of Cervena in Europe.

“Our
venison deserves a premium for its superior quality, but at
present it is largely sold to the commodity market and you
can’t differentiate a commodity. We have to move NZ
venison up the value chain by differentiating it through a
premium brand.”

He said NZ venison was an ideal product
to target at discerning customers who can afford to buy
quality.

“The supply is limited. And we offer all the
quality and traceability bells and whistles, something that
our competitors can’t offer. These are increasingly
important assets when you are selling to top-end retailers
and food service.”

Mr Coup said creating a market
premium for venison was a key element in the DINZ
Passion2Profit strategy which is the subject of an
application for Primary Growth Partnership
funding.

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